Thriving Together through Strategic Small Business Partnerships

The journey to success does not have to be lonely. As a small business owner, building strategic business partnerships with other small business owners is crucial to facilitating growth and building a sense of solidarity with other small businesses. 

A business partnership usually refers to a legal relationship of two or more individuals or companies, often in a written form. However, a business partnership is not always a complicated legal commitment, but it can be a fun and creative collaboration with fellow small business owners. 

Benefits of Partnerships:

The first benefit of business partnerships is increased visibility. One of the biggest challenges small businesses must overcome is finding consumers and increasing brand awareness. Collaborating with other small businesses allows businesses to expand their network and increase exposure to potential customers. 

Through developing strategic partnerships with each other, small businesses are better able to compete with larger businesses. Small businesses may find it more costly to buy from distributors and wholesalers since they do not have the bulk buying power of larger businesses nor do they have the same marketing effectiveness or market share. By working together with other small businesses, small businesses can increase their purchasing power and reduce the costs of operating your businesses. 

Lastly, the partnerships will help small businesses build communities. A survey conducted by Alignable shows that small business owners consider word-of-mouth as the most effective way to acquire new customers. Although referrals heavily depend on positive customer experiences, referrals may also come from the supportive community of small businesses. If both parties of the partnership are local small businesses, the mutual support will also contribute to the local community by benefiting its economy. 

Examples of Partnerships:

Co-branding is a marketing strategy that utilizes at least two brand names on a product or service. Uber and Spotify’s “Soundtrack for Your Ride” partnership, and Nike and Apple’s “Nike+” collaboration are some examples of successful co-branding partnerships. Nashville’s Art Crawl and Pub Crawl are great examples of how local small businesses can co-brand to support each other, increase visibility, and create a supportive local connection. 

Co-marketing is similar to co-branding but it only involves marketing efforts and does not lead to creating a new product or service. It can be beneficial for small businesses that want to broaden their customer base and increase brand awareness in a more cost-effective way. 

Co-opetition is a collaboration between business competitions to gain mutual benefits. 

Corporate partnerships allow small businesses to partner with larger companies. Some companies such as Shopify and Amazon offer partners programs or accelerator programs to support small businesses.

There are many more types of business partnerships. To initiate strategic partnerships, it may be helpful to start with smaller ideas such as cross-promotion on social media, collaborative events and products, or discount offers. It is also important to consider various unique pairings each small business can benefit from. 

How to Start a Lasting Partnership:

People say that business partnerships are like marriages. It is not easy to find the right partner but if it is done right, the partnership will bring synergies to your business. 

Setting up the goal of the partnership is a great beginning step of forming a partnership. A partnership with an unclear purpose will only waste the time and resources. Next, finding a  business that shares the similar values and missions helps small business owners to select a good partner. If a small business prioritizes quality over quantity, it should not partner with a business only interested in increasing sales. 

After setting the expectations and researching some potential partners, it is important to clarify what is expected from the relationship and how it can benefit the partner. Reaching out to potential partners and finding someone a business owner can rely on both personally and professionally take much effort. 

Once the partnership is established, it requires even more effort to keep it strong and lasting. Regular check-ins and clear communication are the keys to ensure that both parties are satisfied. Setting mutual goals in detail with each party’s responsibilities further ensures that the partnership is fair and square. 

Key Takeaways:

• Small businesses can increase visibility, reduce costs and increase revenues, and build communities by establishing business partnerships.

• There are different types of partnerships including co-branding, co-marketing, co-opetition, and corporate partnerships.

• Business partnerships are like marriages and small business owners should be careful and creative in building the relationships. 

As a social impact initiative, Rem and Company also offers free consulting services and resources to small businesses and nonprofits impacted by COVID-19. Our pro-bono consulting teams provide small businesses with the opportunity to identify and prioritize issues facing their business, propose innovative strategies, and facilitate execution. If you are a small business or nonprofit in need of assistance, learn more about how we can help.